Poor telecom facilities hamper e-commerce plans

Poor telecom facilities hamper e-commerce plans

JAKARTA (JP): Poor telecommunication infrastructure and low
computer affordability have caused a slow adoption of the e-
commerce in Indonesia, experts of information technology said
here on Thursday.

Arvino Mudjiarto, country director of Lotus Consulting &
Professional Services, said Indonesia's telecommunication
facilities, the backbone of the multimedia services, were still
too weak to accommodate the vast development of information
technology.

"The accessibility and affordability of computers are very
much limited that only people in big cities are ready for
computers and internet systems," he said.

"Still, most of them do not really understand about computer
functions and usages," he told participants of seminar and
exhibition on telecoms and information technology, the Techno
Pre-Eminence 1999, held until Dec. 11 by state-owned telecoms
company Telkom.

According to Indra Utoyo of Telkom's Multimedia Division,
there were about two million computer users in Indonesia, but
only 250,000 people of them actually possessed and used their own
devices at home.

Arvino said massive education in the use and benefit of
computers in addition to the improvement in the development of
information technology and more even distribution of computers at
different areas were necessary if Indonesia did not want to be
left behind completely in the technology race against neighboring
countries.

Indonesia is considered by analysts as several years behind
other countries in America, Europe and even Asia in developing
the e-commerce. Indonesia has only started using the service in
1997, while the system itself was already famous and widely used
in America since early 1990s.

The Reference Guide to E-commerce in South Asia classified
Indonesia as a country with slow adaptation to e-commerce with
usage growth around 16 percent and 18 percent in the recent year.
Singapore is voted as the most adaptive country with usage growth
reached over 28 percent.

One of the fundamental causes to the slow adaptation is the
fact that the teledensity rate in Indonesia is still very low
with only 3.6 percent of its over 200 million population have
access to telephone lines, which are the basic requirement for
computer and e-commerce use.

The other factor lied on the fact that there was only few e-
commerce service providers operated in the country due to the
high investment and complicated technology, Indra said.

"As far as I'm concerned, Telkom is the only e-commerce
service provider in the country which offer the most
comprehensive services from virtual mall development to billing
arrangement," he said.

He said there were currently five e-commerce service providers
catering for the business-to-business e-commerce and only three
providers for the business-to-customer e-commerce.

Indra said more companies were currently involved in the
business-to-customer e-commerce services, seeking for potential
market on the internet.

He said no less than 500 sites were now available in the
internet offering varieties of products and services to internet
users.

"One of the biggest transactions made by our client users is
booked recently by Agis electronic store, which recorded about Rp
90 million (US$12,857) in sales in two weeks period," he said.
(cst)